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EMEA Natural Gas Update: Futures Rally Following Iran's Latest Hormuz Attacks, Threats

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European natural gas futures edged higher on Friday, after a vessel was attacked in the Gulf of Oman on Thursday and three LNG tankers abandoned their voyage through the Hormuz on Friday.

Front-month Dutch TTF futures were up 0.98%, at 40.80 euros ($46.59) per megawatt-hour, while UK natural gas was up 1.18%, at 97.66 British pence ($1.29) per therm.

Both the Dutch TTF and UK Gas were set to end the week down by 2.56% and 3.30%, according to TradingEconomics.

On Thursday, the United Nations International Maritime Organization said that it had suspended its evacuation operations through the Strait of Hormuz, after a Singaporean commercial vessel was attacked.

IMO's Secretary-General, Arsenio Dominguez, said the decision was taken "to reconfirm that the necessary safety guarantees continue to be in place," while noting that the vessel, which came under attack, did not abide by the IMO's evacuation framework.

On Friday, three oil tankers seeking passage through the Strait reportedly retreated after being warned by Iran's IRGC for crossing without authorization, according to an Al Jazeera report, citing Iranian state broadcaster IRIB.

Traffic along the strait, which accounted for one-fifth of global LNG flows, looked muted despite its apparent reopening with 12 vessels transiting over the past 24 hours, and 15 currently making the treacherous voyage, according to the Hormuz Strait Monitor.

According to Daniel Hynes, a senior commodity strategist at ANZ, this included two cargoes of LNG loaded from Qatar's Ras Laffan export facility. He, however, noted that the latest attacks would likely prompt exporters to re-evaluate short-term plans, which could add to supply constraints.

European gas inventories are at 47.43% of capacity, down from 56.91% in the same period a year ago, according to Gas Infrastructure Europe.

Inventories were also significantly below the five-year average for this period, at 62.00%, according to the Swiss Federal Office of Energy.

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